US stocks are expected to maintain their bullish trend as investors prepare for the busy week of the third-quarter earnings season, with megacap tech companies like Apple, Microsoft, Meta Platforms, Amazon, and Alphabet set to report earnings this week. Investors also await significant US economic data, such as preliminary GDP, PCE price index, and PMI readings.

“This week is shaping up to be a big week for the US markets. Many of the Magnificent Seven firms will declare their results, including Alphabet, Apple, Microsoft, Meta, and Amazon. Tesla declared its third-quarter results earlier this week, which were surprisingly positive after the car manufacturer delivered two disappointing back-to-back quarterly results,” says Yogesh Kansal, Co-Founder & CMO, Appreciate.

This week, global investors will be paying close attention to several highly anticipated economic releases, with the September jobs report on Friday expected to provide significant data as the Federal Reserve focuses on the labor market. Meanwhile, Big Tech corporations, food chains, and pharmaceutical titans are expected to report significant results.

This week, the Personal Consumption Expenditures (PCE) inflation report will be released on Thursday, followed by the first publication of third-quarter GDP on Wednesday.

“Apple’s quarterly results will be the focus of the coming week, and the spotlight will likely be on iPhone 16’s sluggish sales. Data from the Personal Consumption Expenditure, the preferred inflation gauge of the Federal Reserve, will also be revealed on Thursday.

Economists are anticipating both the core and total PCE to deliver a marginal spike without any major inflationary shocks that could threaten the Federal Reserve’s soft landing scenario. Core PCE is expected to spike up by 0.3%, while the total PCE could likely increase by 0.2%. A day after the release of the PCE data, the October jobs report will also be unveiled on Friday.

Unemployment is expected to hold steady, and average hourly wages could decrease by 0.3%, month-on-month. The impact of Hurricane Helene and the labour strikes at Boeing would be visible as distortions in the October jobs report.

There could be a noticeable drawdown in nonfarm payrolls, however, the full brunt of the hurricane and the strikes will likely be captured in the November jobs report,” adds Yogesh.

Meanwhile, a weaker yen boosted equities further after Japan’s weekend election ended in a hung parliament, confounding the Bank of Japan’s rate hike plans. Meanwhile, investors remained cautious with just one week until the US presidential election on November 5.

Earnings releases from major technology companies, volatility in US debt markets, Friday’s monthly jobs report for October, and the final stretch of a fractious presidential race will all have a significant impact. “Elevated U.S. Treasury yields, expectations around Federal Reserve rate policies, and regional economic pressures continue to set the tone, underscoring the challenges and opportunities within the global financial landscape,” says Bas Kooijman is the CEO and Asset Manager of DHF Capital.

Source: Financial Express